Digitally Distributed Coupons Increase By 17% In H1 2015

MINNEAPOLIS, MN, August 26, 2015 – The number of digitally distributed coupons for Consumer Packaged Goods (CPG) brands on key websites increased by 16.7 percent in H1 2015, according to analysis conducted by Kantar Media.

The increase was attributable primarily to food areas, according to Darcy Douglas, Director Marx Account Solutions, at Kantar Media. Within food, the Dry Grocery area, which is historically the largest area in digitally distributed coupons, accounted for much of the growth.

Digital Event Growth 

Source: Kantar Media
H1: January – June.
Digital coupon data is based on ongoing monitoring of a selection of leading coupon websites.
A Digital Event is defined as the drop date of a specific product, with a specific Face Value and purchase requirement, by a specific digital coupon distributor.

Douglas also noted that the Face Values of digitally distributed coupons were in flux during the first half of the year, with five of nine areas in digital promotion increasing incentives.

“This fluctuation may signal a shift in the way manufacturers are leveraging digitally distributed coupons to target shoppers online”, says Douglas. “Manufacturers often apply different strategies and tactics to their digital promotions compared to print promotions and will adjust digital promotions on the fly, depending on how quickly shoppers respond to digital incentives across various websites.”
Digital Activity and Print FSI Activity
Source: Kantar Media
1. Digital Face Value is averaged across all events for that Area
2. Print FSI Face Value is averaged and weighted by Coupons Dropped for that Area

Dollar Channel Had the Lowest Incentive Across Key Channels in H1 2015

Kantar Media also examined trends in the incentives that various retail channels offered on digitally distributed coupons, In H1 2015, these incentives reached $1.72 across all areas and retail channels, a 4.2 percent increase year over year. However, incentive levels varied significantly amongst different retail channels.

“Incentives are a critical part of a digitally distributed promotion, and misaligning your incentives could mean the difference between a brand offer being clipped or printed or just ignored,” stated Douglas. The Dollar Channel websites had the lowest level of incentives in H1 2015 at $1.41 - 27% below the incentives offered on Mass Channel websites and significantly below Drug Channel websites, which offered the greatest incentive at $1.94.

Industry Incentives h1 2015 

Source: Kantar Media
H1: January – June.

Dollar Channel Had the Highest Estimated Expenditures in Vitamins Category in H1 2015

Some interesting trends were observed in the high-profile Vitamins Category. Here the Dollar Channel balanced lower incentives with significant increases in coupon activity. Average Face Value remained well below what was seen in other channels at just $1.86 – significantly below the average incentive of $3.43 seen in the Mass Channel in H1 2015. However, Estimated Expenditures experienced over 600 percent growth during that period, while Drug and Mass Channel websites growth actually saw declines in H1 2015. These significant increases allowed the Dollar Channel to actually outspend Mass in the Vitamin Category.

 Special Analysis Vitamin Category

Source: Kantar Media
# of Events is based on the drop date of a specific product, with a specific Face Value and purchase requirement, by a specific digital coupon distributor. Estimated Prints (and/or clips) represent the number of digitally distributed coupons printed for each event, aggregated. Estimated Expenditure is the associated cost with a digitally distributed print/clip. Average Face Value (and Unit Value) is averaged across all events

“Promotion incentive tactics should not be ignored in the Dollar Channel,” said Douglas. “It is critical for companies planning digital promotions to understand how incentives and investment levels compare across different Channels, and know how these programs could impact their brands and categories. Determining the right digital incentive level takes partnership with a retailer, knowledge of the product, and an analysis of which websites are performing best in the Drug Channel. And, to really deliver value, a brand should understand your competitor’s incentives, across the same websites.”

“Armed with key insights on the websites, and the shopper’s behaviors, a manufacturer can work with a retailer to build an online program that helps deliver the right volume at the right time – and at the right incentive level. Everybody wins in the digital landscape when incentives are done right,” concluded Douglas.

About Kantar Media

Kantar Media is a global leader in media intelligence, providing clients with the data they need to make informed decisions on all aspects of media measurement, monitoring and selection.
Part of Kantar, the data investment management arm of WPP, Kantar Media provides the most comprehensive and accurate intelligence on media consumption, performance and value.

For further information, please visit us at www.KantarMedia.US

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